Vietnam reiterates it does not use currency for unfair trade

Vietnam’s central bank, refuting the U.S. Treasury’s move to designate the Southeast Asian nation a currency manipulator, said it does not use its exchange rates “to create an unfair competitive advantage in international trade,” the regulator said in a statement on its website.

Vietnam’s “exchange rate management in recent years is within its general framework of monetary policy and aims to achieve the consistent goal of controlling inflation, stabilizing macro-economy” and does not create an unfair competitive advantage for the nation, the State Bank of Vietnam said.

The Vietnamese dong traded at 23,127 per dollar, little changed from yesterday. The benchmark VN Index of Vietnamese stocks lost 1% as of 9:22 a.m. local time and is poised for its biggest decline in a month.

Vietnam’s trade surplus with the U.S. and its current account surplus are the result of a range of factors related to the peculiarities of the Vietnamese economy, the statement said.

The central bank’s recent purchase of foreign currencies “is to ensure the smooth operation of the foreign exchange market in the context of an abundant supply of foreign currencies,” the regulator said. “It is also contributing to macroeconomic stability and at the same time strengthening foreign exchange reserves which are at low levels compared to other countries in the region to strengthen national monetary and financial security.”

The central bank will coordinate with government ministries and agencies to respond to U.S. concerns for the mutual benefit of both countries, it said. “Vietnam attaches great importance to a stable and sustainable economic-trade relationship with the U.S.,” the regulator said.

“At the same time, the State Bank will continue to administer its monetary policies to control inflation, stabilize the macro-economy, support economic growth in a reasonable manner and manage exchange rates flexibly” in line with monetary policy goals that “are not aimed at creating unfair international trade competitive advantage,” it said.